S&P 500 Earnings Yield Falls Below 10-Year Treasury Yield

U.S. stocks are trading at a negative equity risk premium against Treasurys, with the S&P 500’s trailing earnings yield below the yield on 10-year government debt as valuations remain elevated. The S&P 500 closed at 7,811.51 on Friday, Oct. 9, less than 0.1% below its record close of 7,818.93 set Tuesday, Oct. 6. At the record-close level, the index traded at about 27 times trailing earnings, implying an earnings yield of roughly 3.7%. The 10-year Treasury yield reached 5.31% on Monday, Oct. 5.

Source: TokenPost